Topic: Has anyone ever studied how Bitcoin could dramatically drop? - page 2. (Read 222 times)

Fiat money and the global debt bubble are much worse than a few years ago, so those fundamentals should help Bitcoin resume the rally ASAP! 

Thanks to everyone who replied!
@Wave Rider well the fact is that bitcoin these days reached a nice peak!

I have studied how Bitcoin does dramatically drop, and the numbers are stunning. The first Big Bull market went from $1 to over $32 very quickly and when the crash came it eventually bottomed at almost exactly $2! Every other big rise has been followed by a Huge fall. How and why people enjoy blindness to this reality (ie HODL!) is hard for me to understand, but their losses create gains for good traders.

Man, as a student, I don't know if that's the best way to put it. But I know the history of bitcoin and its big price drops, I know it's an extremely volatile asset, but I also know the long term trend is unstoppable upwards, so I don't care so much about the drops.

And precisely in this cycle it does not seem that there is going to be as much to worry about as in the previous ones. If you go long, to a minimum of 4 years of investment, you should not worry too much.

By the word it say Bitcoin movement is unpredictable that already a great indicator that no one could accurately say on when Bitcoin would drop. If you are doubting to accumulate now  listen to your self since that indicate that you are not ready to invest on Bitcoin.

Better do some research first and try to learn more information about this coin.

Anyways try to read this https://cointelegraph.com/learn/articles/day-trading-vs-long-term-cryptocurrency-hodling-benefits-and-drawbacks Maybe you could get some knowledge which is useful for your future investment or trades.

This is my personal opinion, the rise or fall of a coin whether Bitcoin or any coin is a common thing, in essence every time there is a buyer there must be a seller, this triggers an increase or decrease in price, if you ask ‘how can Bitcoin drop dramatically’? of course this cannot escape the bad news that happened, so the holder decided to sell because of fear, but if you are really an investor who wants to buy Bitcoin in the long term, you don't need to worry about that because the potential for future Bitcoin increases, we can see from the amount of good news circulating today, before deciding to buy you have to believe in what you are buying, if necessary do basic research so that your confidence is getting stronger.
 

to first know how it can drop dramatically, you need to also look into why it doesnt..

basic economics.. if the most efficient mining cost on the planet was say $60k.. no one can get bitcoin for less, so no one would want to sell bitcoin for less as that is then a loss..
so with the speculation above $60k shows people right now hare happy to pay ~$100k on the public markets. if the speculation/demand dried up people would give up selling coin to the $60k mark and the speculation would begin again to raise the price

at this moment the pacific islands (japan, hawaii and such) have high electric cost thus high mining cost ($350k/btc) so they ar very happy to market speculate and buy coin at just $100k(3.5x discount, so very happy), thus support the buy pressure..
the cheapest mining cost on the planet is ~$60k and thus sets the bottom support level..
and everyone else has varying cost/value sentiments in the middle, and so that is why there is a large spread in the speculative window of possible volatility at any given time.. (this season the price can swing between $60k-$350k, (but is steadily playing around the $100k mark right now))

so then you can ask why would the price want to or need to drop to the bottom
the reason: market correction after a sudden pump/rise/spike

then you can ask how could we drop the most efficient mining cost or make it so even miners would sell at a loss to break the bottom and go lower quickly
the reasons..
the code bugs out and makes bitcoin break its economics
the mining cost of hardware or electric gets cheaper by some other efficiency reason
the hashrate drops via less miners, where it becomes cheaper to mine for the remaining miners due to less competition

there is scenarios where by all the miners that are mining at a cost of $60k-$90k would drop off from mining when the market goes down. this means the remaining miners at a previous $60k cost get more sats per block so they are then averaging like $30k per coin cost which can then allow for the market to fall to $30k..

but this would require the market speculation to dry up where the amount of buyer are not trying to support and raise the price, but instead are selling in fear and dropping the price
..
now here is a thing about the "bottom" being well supported and how its not easy to just drop the bottom..

many asic farms dont pay bills per month. instead they buy electric unit contracts that cover 1-2years of constant power. so there is no point in switching hardware off. so they have a fixed cost over 1-2 years so they end up supporting a minimum hashpower baseline of competition.. bitcoin code would need to severely and long term/permanently break to cause the mass asic farms to switch off and cause the step down of the "bottom" to cause significant price drop

..
all you need to know is (as said) while no bug is breaking bitcoin, this season the market can swing between $60k-$350k so expect that when it gets near the premium there is then more room for a larger correction back down to value (the higher it rises the bigger the fall)

whilst there is no bug breaking bitcoin. periodically/seasonally the speculative value-premium window will move up. whereby for instance as of summer and winter the $60k minimum is no longer $60k but a higher number. and the $350k possible premium is no longer $350k but even higher...

but..
if there was a bug or something significant happening to the underlying mining cost which can impact the speculative window of value-premium to drop. then the market could significantly drop

You can avoid big loss by using orders like Stop loss order, or Stop limit order.

Stop loss, one of best weapons in Trading.
Stop limit order, another weapon in Trading.

Understand about Bitcoin correction history and psychology of market cycles can help too.
The article.

Psychology of market cycles.

You do not need to worry by now. Just buy and hold it because the price will rise to at least to $150000. What you should be concerned about is 2026 if the price will fall or not. We do not know yet how bitcoin strategic reserve will make the price be during that time. Normally 2026 supposed to be a bear market time but we do not know if the bitcoin strategic reserve will make it be otherwise or not.

I hope this will never happen of course, but for who have invested capitals, it may be a question someone have answered accurately to avoid an important loss.